Sam is a professional trader and the lead stock market news writer at AskTraders. After starting his career in the forex market, Sam now focuses on gold and stocks with a preference for fundamental and macroeconomic analysis.
Open Orphan (LON: ORPH) shares are trading higher on Monday after it announced a proposal to make a distribution in specie of the entire issued share capital of its wholly-owned subsidiary, Orph Pharma IP, to Poolbeg Pharma, in return for the issue of new shares by Poolbeg to Open Orphan shareholders.
Open Orphan shareholders have already granted approval with shares marked “ex-rights” on 16 June 2021. Shareholders will receive one Poolbeg Share for every 2.98 ordinary shares held in the company.
However, there will be a lock-up period for relevant shareholders who receive Poolbeg shares. They will not be able to sell, transfer or deal in Poolbeg Shares for 9 calendar months.
Croft Nominees Limited will hold the legal title to the Poolbeg shares until the date, which is 9 months from admission. Once the lock-up expires, Croft will then ass the share certificate to Poolbeg's registrar and will execute the stock transfer forms to the relevant shareholders.
Open Orphan and Poolbeg will also into a demerger agreement as part of the deal.
Open Orphan's share price is currently trading at 38.05p, up 6.28% following the news. At the open, it jumped as high as 39.5p.
Open Orphan shares are traded on the London stock exchange's AIM market (the alternative investment market), which is the submarket specifically for smaller companies. AIM stocks are attractive to investors as they have tax advantages and smaller companies have the potential to benefit from rapid growth. But are Open Orphan shares the best buy? Our stock market analysts regularly review the market and share their picks for high growth companies
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage . 75 % of retail investor accounts lose money when trading CFDs with this provider . You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money .